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Stephen Moore withdraws from Fed consideration, Trump says

Key Points
  • Stephen Moore, a conservative pundit, withdrew from consideration for the Federal Reserve Board, President Donald Trump said on Twitter.
  • Moore was under fire for his economic and political views, messy divorce and past statements, including columns in which he belittled women and his former wife. Several Republican senators said he would have difficulty winning confirmation.
  • Herman Cain, the businessman and former GOP presidential candidate, dropped out of contention for the Fed in late April.
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Trump: Stephen Moore has withdrawn his name from Fed consideration

Conservative economics pundit Stephen Moore has withdrawn his bid to be appointed to the Federal Reserve Board — within hours of boasting that he expected to be easily confirmed by the Senate — President Donald Trump said Thursday in a Twitter post.

Moore's putative nomination for the central bank had faced intense criticism and scrutiny after Trump said he wanted him on the Federal Reserve board.

Moore, a 59-year-old visiting fellow at the Heritage Foundation think tank, drew fire for his economic views, a messy divorce, a $75,000 IRS income tax lien and past statements that belittled women.

"This is kind of a victory lap for the left because they took me down with a smear campaign," Moore said in an interview with Fox Business Network on Thursday.

Moore, in his withdrawal letter to Trump, likewise blamed "the unrelenting attacks on my character," which "have become untenable for me and my family and 3 more months of this would be too hard on us."

A senior administration official told CNBC that Moore decided to drop out on Wednesday night and informed Trump's top economics advisor Larry Kudlow of that decision in a phone call. Despite that, Moore told several media outlets on Thursday he planned to continue his effort to win approval by the Senate, and predicted he would be successful in that bid.

His withdrawal comes less than two weeks after businessman Herman Cain dropped out from Fed board contention because of opposition from a number of Republican senators. Moore likewise was facing pushback from multiple GOP senators this week.

Two other Fed picks by Trump, Nellie Liang and Marvin Goodfriend, likewise failed.

While Moore told the president in his withdrawal letter that he will continue to support the presidents economic policies, the one place he will not be working is on the 2020 re-election campaign. A senior Trump campaign official told CNBC on Thursday that Moore will not be joining their operation.

Not long before Trump's announcement Thursday, Moore said in an interview with Bloomberg News that he disagrees with Trump's call for the central bank to sharply cut rates.

"I'm not so sure I agree with the White House that we should cut rates by an entire percentage point," said Moore, who has been critical of the Fed in the past. "I just don't see the case for that right now."

In that same interview, Moore said, "I think I'm going to win a big majority. ... Just because a senator today says they won't vote for me doesn't mean that three months from now they won't."

Senate Minority Leader Chuck Schumer, D-NY, quickly called on Trump on Thursday to nominate "two serious candidates," pointedly suggesting that Cain and Moore were anything that that.

Sen. Shelley Moore Capito, a Republican from West Virginia, told reporters that Moore's withdrawal "was a good move, and I look forward to the next nominee."

Asked if Moore's case provided the White House with a lesson on vetting nominees for government posts, Capito quipped, "Read people's articles that they write would be a good start."

A White House official told CNBC that Moore's nomination was still considered viable as of Wednesday.

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Stephen Moore: The biggest problem in the economy is decline of male earnings

Also Thursday, The Guardian newspaper, citing a source, said Moore had been shorting his ex-wife Allison for years on the amount he was obligated to pay her in alimony and child support under the terms of their divorce settlement. The Guardian said Moore was underpaying Allison by $8,000 per month.

A Virginia judge had found Moore in contempt of court in 2012 for reneging on more than $330,000 in settlement, alimony and child support payments to Allison. Moore avoided a court-ordered sale of his home only after paying Allison two-thirds of what he owed her at the time.

Trump had yet to officially nominate Moore for the Fed board, which requires Senate confirmation. Several Republican senators had indicated the bid was in trouble.

Stephen Moore
Andrew Harrer | Bloomberg | Getty Images

"Very unlikely that I would support that person," Sen. Joni Ernst, R-Iowa, told reporters when asked about a potential Moore nomination.

Senate Majority Whip John Thune, R-S.D., told The Washington Post that confirming Moore would be a "very heavy lift."

The GOP has a 53-47 edge in the Senate, so Moore could only afford to lose three Republicans. The term for the Fed board role is 14 years.

On Thursday, Ernst told CNBC, through her spokeswoman, "I'm glad to see Moore withdraw. It's the right call for him to move on. I'm hopeful we can see someone nominated who is more appropriate for the Fed Board."

Despite the steady criticism and revelations about his previous writings, Moore continued to fight for his shot for a seat on the Fed. "You know, they're pulling a Kavanaugh against me," he told a radio interviewer in late April, referring to how Supreme Court Justice Brett Kavanaugh's nomination was imperiled by late-stage accusations of sexual misconduct.

"If it comes down to things I wrote 18 years ago that were impolitic, that I've apologized for, that were, you know, insulting, then I'm in trouble," he told CNBC in an interview April 30. "If it comes to economic ideas, then I'll be fine."

While Moore, a conservative pundit and former member of The Wall Street Journal editorial board, had taken flak over his divorce and columns featuring jokes about AIDS and his ex-wife, his economic and political stances also came under fire. Greg Mankiw, a former economics advisor to President George W. Bush, had said Moore doesn't have the "intellectual gravitas for this important job."

There were also concerns that Moore could politicize the Fed, given his allegiance to Trump. Both men have been critical of Fed Chairman Jerome Powell for raising interest rates, which, Moore and Trump argued, put a damper on otherwise persistent U.S. economic growth.

Moore advised the Trump campaign on economic policy and the Trump administration during the push for the 2017 tax-cut bill. He also co-wrote the book "Trumponomics: Inside the America First Plan to Get Our Economy Back on Track," which was published in October. Moore is also a longtime associate of Kudlow, a former CNBC contributor.

Cain, a former Kansas City Fed chairman, like Moore is an outspoken defender of Trump and a critic of the Fed. Cain's candidacy for a spot on the central bank's board revived past accusations of sexual misconduct against him that arose during his failed bid for the 2012 GOP presidential nomination. He has denied the allegations.

Late Thursday afternoon, hours after Moore's withdrawal was announced, a senior administration official told CNBC that Moore on Wednesday night had called Kudlow and said he had decided to pull out of consideration.

Kudlow was reluctant to accept Moore's decision, and asked him to "sleep on it," the official said.

But Moore told Kudlow, "it's irrevocable."

Kudlow accepted Moore's decision, but asked him not to reveal it publicly until Trump could tweet out the news, the official said. Kudlow told Trump about Moore's call on Thursday morning, shortly before the president began participation in National Day of Prayer events. He tweeted the news about Moore early Thursday afternoon.

Asked whether Moore withdrew voluntarily or was pushed, the official said "it was his decision — we supported him."

"These things are hard, they're hard. It's a tough town," the official said. "We all wish he hadn't written about women's basketball and all that other nonsense — who knew? But then again, it was 20 years ago. Really — it's that important?"

This official admitted it was "weird" that Moore was publicly saying he was all in for the fight just 45 minutes before the president tweeted, but speculated that Moore may have felt bound by his promise to Kudlow not to say anything until the president issued the news.

The official also says it's unlikely Moore's comments to Bloomberg News disagreeing with the president on interest rates had anything to do with the matter, because it's unlikely the president saw those comments.

"I still think, on economic and policy grounds, he was an excellent choice," the official said. "I'm sorry he will not get his day in court in front of the committee."

Moore's letter to Trump said:

Mr. President,

I was honored and grateful that you asked me to serve on the Federal Reserve Board. Your economic policies have been a spectacular success for American workers. Record low unemployment, 3.2% growth, seven million job openings, and a near 40% rise in the stock market with five quarters now of 3% economic growth, something your critics said could never happen. Trumponomics has been VINDICATED.

Your confidence in me makes what I am about to say much harder. I am respectfully asking that you withdraw my name from consideration. The unrelenting attacks on my character have become untenable for me and my family and 3 more months of this would be too hard on us.

As you know, for the last four years nearly since the start of your campaign for President, I have been an advocate of your economic agenda and am proud to have played a small role in helping make that happen. I will continue to be a loud economic voice advocating for your policies, which will keep us on a prosperous path of 3 to 4% growth with rising wages and low inflation for as far as the eye can see,. I am always at your disposal.

With the greatest regards and respect.

Stephen Moore

- Additional reporting by CNBC's Brian Schwartz and Kevin Breuninger